Recent findings indicate that the Nigerian naira has experienced a significant 38.9% depreciation against the United States dollar at the official Investors and Exporters (I&E) window of the Central Bank of Nigeria (CBN) within the last three months.

Data from the FMDQ Securities Exchange reveals a drop from N745.19/$ on October 3, 2023, to N1035.12/$ as of January 3, 2024.

Despite the efforts of the Federal Government to enhance liquidity in the foreign exchange (FX) market, the naira’s volatility persists, adversely affecting the manufacturing and organized private sectors.

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Organizations such as the Manufacturers Association of Nigeria (MAN), Lagos Chamber of Commerce and Industry (LCCI), and the Nigerian Association of Small-Scale Industrialists have reported operational downsizing due to the worsening naira value at both official and parallel markets, potentially leading to further job losses.

The naira’s decline continued into 2024, starting at N988.46/$ and further tumbling to N1035.12/$ on January 3.

This marks the third time the naira has closed above N1000/$ on the I&E window.

The World Bank, in its December Nigeria Development Update, highlighted concerns about low FX volumes and emphasized the importance of stabilizing the official FX market at market-reflective rates.

Efforts to address the situation include a $2.25 billion foreign exchange support facility received by the Federal Government from the African Import-Export Bank.

Despite these interventions, the naira has not responded positively, raising worries among manufacturers and the private sector.

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Manufacturers are particularly distressed about the potential calamitous impact on the real sector of the economy, with fears that sustained trends could lead to further shutdowns.

The President of MAN, Francis Meshioye, expressed concerns over the continuous closure of manufacturing operations, emphasizing the need for a lasting solution to the forex illiquidity crisis.

The Central Bank of Nigeria, under Governor Olayemi Cardoso, acknowledges the volatility and is reportedly reviewing policies to address the situation comprehensively.

However, the challenges persist, and stakeholders are urging the government to take decisive actions to stabilize the naira and safeguard the interests of businesses and the economy.